Packaging Corporation of America (PCA) has posted a net income of $203m or $2.24 per share in the second quarter (Q2) of financial year 2023 (FY23).
This reflects a decline of 32% in net income from $301.5m in Q2 of FY22.
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After excluding special items, the company said its net income for this quarter, which ended on 30 June 2023, was $209m or $2.31 per share, compared with $303.7m during the same period last year.
PCA has attributed this $0.92 per share decrease in net sales to the lower volumes in different segments, with a $0.90 per share decrease in its Packaging segment and a $0.07 per share decline in its Paper segment.
This loss was also driven by a lower price and mix in the Packaging segment, as well as higher depreciation expenses and increased converting costs.
PCA’s consolidated gross profit was $444.7m for the current quarter, a decrease of 24.4% against $588.8m in the last year’s period.
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By GlobalDataThe company’s net sales for the reported quarter totalled $2bn versus net sales of $2.2bn in the same period last year.
This Q2, the net sales for PCA’s Packaging segment also decreased to $1.79bn from the $2.06bn that was recorded during the previous year’s Q2.
The Paper segment’s net sales were $142.8m in Q2 FY23, a decrease from $149.8m a year ago.
PCA’s basic and diluted earnings per share in Q2 FY23 were $2.25 and $2.24, respectively.
PCA chairperson and CEO Mark W Kowlzan said: “Looking ahead as we move from the second and into the third quarter in our Packaging segment, although there is one less shipping day for the corrugated business, we expect shipments per day to improve versus the second quarter.
“However, prices will be lower as a result of the previously published domestic containerboard price decreases along with slightly lower export prices.
“Operating and converting costs should trend slightly higher primarily due to higher recycled fibre prices and seasonal energy cost. Finally, we estimate our depreciation expense and tax rate to be slightly higher as well. Considering these items, we expect third-quarter earnings of $1.88 per share.”
